Spofford v. State Loan Co.

Morton, J. This is apparently a case of hardship for the plaintiffs. We say apparently because it is possible that the situation in which the plaintiffs find themselves may be due to their own extravagance or imprudence. The plaintiffs contend that the releases which were given by them before the giving of the mortgage now in question were null and void; and the defendant conceded at the hearing before the single justice that if they were, then the excess which it had received over and above the statutory rate of eighteen per cent entitled the plaintiffs to a discharge of the mortgage. The single justice found that the releases had not been obtained by fraud, and ruled in effect that they were valid and binding on the plaintiffs. A decree was thereupon entered, after the plaintiffs had amended their bill, allowing them to redeem the outstanding mortgage upon paying the principal sum of $335 secured by the mortgage, with interest at the rate of eighteen per cent to the date of payment. The plaintiffs appealed. We think that the ruling and finding were right. The amount borrowed and for which the original mortgage was given was $405. There is nothing in the statute (R. L. c. 102, § 51) which renders it illegal for the lender to ask for and receive more than eighteen per cent interest when the amount borrowed is less than $1,000. As the single justice said (we quote from his memorandum of decision which is printed with the papers in the case): “ R. L. c. 102, § 51, does not forbid the making of a loan at the rate of forty-eight per cent a year; all that it provides is that a loan for less than $1,000 shall be discharged upon payment or tender of the sum actually [88] borrowed, with interest at the rate of eighteen per cent a year, plus a sum not exceeding $5 for the actual expenses of making and securing the loan ; provided, however, that in any event the holder is entitled to interest equal to nine per cent of the sum lent.” At the expiration of every six months, when the sum secured by the mortgage fell due, the defendant had a right to demand payment, and, if the sum due was not paid, to foreclose the mortgage. If the plaintiffs could not pay or did not want to pay the amount due, or make a tender as provided by the statute, the parties could agree, upon such terms as they saw fit, to a renewal of the mortgage and a discharge of the old one and a release of any and all claims which the plaintiffs might have against the defendant under the statute or otherwise. There was nothing unlawful in such an arrangement whatever the rate of interest agreed upon might be. The statute being intended for the benefit of the borrower, the plaintiffs if they chose could relinquish any rights that had accrued to them under it. Wall v. Metropolitan Stock Exchange, 168 Mass. 282. It is possible, of course, that the Legislature has left open a door which they meant to shut, but if so, it is for them and not for us to close it. There is nothing to show that any fraud or misrepresentation was practised upon the plaintiffs by the defendant, or that there was any suppression intentional or otherwise of information which should have been communicated by the defendant to the plaintiffs. Decree affirmed.